The Prime Minister's Economic Advisory Council will on Wednesday release the outlook for the Indian economy for the current fiscal and is likely to scale down growth projection from earlier 8.5 per cent to 7.5-8 per cent.

The outlook will be released on Wednesday, an EAC official said in New Delhi. The outlook will be out a day after the official figures showed industrial growth slowing down to 5.2 per cent in the first quarter of this fiscal from 10.3 per cent a year ago.

Taking cues from lower IIP figures, economists are projecting economic growth to moderate to below 8 per cent this fiscal from 9.1 per cent last year.

The outlook will come a few days after EAC chairman C Rangarajan resigned amid speculations that he is being nominated to Rajya Sabha. He is replaced by noted economist Suresh Tendulkar, who was earlier a member of the panel.

Before stepping down from the post, Rangarajan had said India's growth could moderate to 7.5-8 per cent this fiscal and saw no change in RBI's tight monetary stance till inflation cools down.

"There are certain factors, both domestic and external, which may add to the slowdown of growth rate, but we still think that the growth rate could be 7.5 to 8 per cent," he had said.

The country registered 9.1 per cent GDP growth in 2007-08, but a host of measures, including the monetary steps by RBI, to contain inflation may have taken a toll on economic expansion.

Rangarajan had said until there is a significant change in the price situation the current stance of RBI would continue. "If there is moderation in the price, I am quite sure that monetary policy stance would change."

He expected inflation to ease to 8-9 per cent by the end of March 2009 from over 12 per cent now.